M/s Thomson Reuters International Services Private Limited, Mumbai V. Deputy Commissioner of Income Tax, Circle-5(1)(1), Bangalore

SA 112/BANG/2018

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 5886 (ITAT-BANGALORE)
• Duration Of Justice: 1 year(s) 1 month(s) 9 day(s)
• Appeal Type: Income Tax (Transfer Pricing) Appeal
• Pronouncement Date: 01-05-2019
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Assessment Year: 2010-2011
• Appeal Filed On: 23-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: PADMA MEENAKSHI
• Assessee Lawyers: T SURYANARAYANA

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL B BENCH : BANGALORE BEFORESHRI N.V. VASUDEVAN, JUDICIAL MEMBER AND SHRI ARUN KUMAR GARODIA, ACCOUNTANT MEMBER S.P. NO. 111/BANG/2018 (IN IT (TP) A NO. 266/ BANG/201 4 ) ASSESSMENT YEAR : 2009 - 10 M/S. THOMSON REUTERS INTERNATIONAL SERVICES PVT. LTD., [SUCCESSOR-IN-INTEREST TO THOMSON REUTERS INDIA SERVICES PVT. LTD.], DIVYASREE TECHNOPOLIS, 36/2 AND 124, YAMALUR VILLAGE, VARTHUR HOBLI, OFF HAL AIRPORT ROAD, BANGALORE 560 037. PAN: AAACW 1663L VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 12 (4), BANGALORE. APPELLANT RESPONDENT S.P. NO. 112/BANG/2018 (IN IT(TP)A NO. 542/BANG/2015) ASSESSMENT YEAR : 2010 - 11 M/S. THOMSON REUTERS INTERNATIONAL SERVICES PVT. LTD., [SUCCESSOR-IN-INTEREST TO THOMSON REUTERS INDIA SERVICES PVT. LTD.], DIVYASREE TECHNOPOLIS, 36/2 AND 124, YAMALUR VILLAGE, VARTHUR HOBLI, OFF HAL AIRPORT ROAD, BANGALORE 560 037. PAN: AAACW 1663L VS. THE DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE 5 (1) (1), BANGALORE. APPELLANT RESPONDENT ASSESSEE BY : SHRI T. SURYANARAYANA, CA REVENUE BY : SMT. PADMA MEENAKSHI, JCIT (DR) DATE OF HEARING : 06.04.2018 DATE OF PRONOUNCEMENT : 06 .0 4 .2018 O R D E R PER SHRI A.K. GARODIA, ACCOUNTANT MEMBER; BOTH THESE STAY PETITIONS ARE FILED BY THE ASSESSEE SEEKING STAY OF DISPUTED OUTSTANDING DEMAND OF RS. 28,97,57,450/- FOR ASSESS MENT YEAR 2009-10 AND RS. 29,87,21,995/- FOR ASSESSMENT YEAR 2010-11. S.P. NOS. 111 & 112/BANG/2018 (IN IT(TP)A NO. 266/BANG/2014 & IT(TP)A NO. 542/BANG/2015) PAGE 2 OF 3 2. IT IS SUBMITTED BY LD. AR OF ASSESSEE BEFORE US IN COURSE OF HEARING THAT AS PER PAGE NO. 15 OF THE STAY PETITION FOR ASSESSMENT YEAR 201 0-11, THE ASSESSEE HAS SUBMITTED THE COMPUTATION OF THE DEMAND POSITION FOR ASSESSME NT YEAR 2010-11 IF THE DISALLOWANCE MADE BY THE AO U/S. 10A OF IT ACT OF R S. 99,77,62,717/- IS IGNORED BECAUSE THIS ISSUE IS COVERED IN FAVOUR OF THE ASSE SSEE BY THE TRIBUNAL ORDER IN ASSESSEES OWN CASE FOR ASSESSMENT YEARS 2007-08 IN IT(TP)A NO. 1206/BANG/2011 DATED 06.04.2017 AND FOR ASSESSMENT YEAR 2008-09 IN IT(TP)A NO. 1565/BANG/2012 DATED 28.09.2017, COPY OF WHICH ARE SUBMITTED ALONG WITH THE STAY PETITION AND AS PER THESE TWO TRIBUNAL ORDERS, IT WAS HELD THAT THE ASS ESSEES CLAIM FOR DEDUCTION U/S. 10A HAS TO BE ALLOWED BY FOLLOWING THE JUDGEMENT OF HON 'BLE KARNATAKA HIGH COURT RENDERED IN THE CASE OF CIT VS. TATA ELXSI LTD., 349 ITR 98. HE SUBMITTED THAT AS PER THE WORKING GIVEN BY THE ASSESSEE ON THIS PAGE 15 OF THE STAY PETITION FOR THIS ASSESSMENT YEAR I.E. ASSESSMENT YEAR 2010-11, IF THE DISALLOWANCE OF THE ASSESSEES CLAIM FOR DEDUCTION U/S. 10A OF IT ACT O F RS. 99,77,62,717/- IS IGNORED THEN THERE WILL BE A REFUND DUE IN THIS YEA R OF RS. 26,15,87,456/- AS AGAINST THE DEMAND OF RS. 28,97,57,450/- FOR ASSESS MENT YEAR 2009-10 AND THEREFORE, UNDER THESE FACTS, STAY SHOULD BE GRANTE D FOR BOTH YEARS. HE ALSO SUBMITTED THAT HEARING OF THESE TWO APPEALS MAY BE FIXED ON 07.05.2018. THE LD. DR OF REVENUE STRONGLY OPPOSED THE GRANTING OF STAY. 3. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS. IN VIEW OF THIS FACT THAT IF THE DISALLOWANCE OF THE ASSESSEES CLAIM FOR DEDUCTION U/S. 10A OF IT ACT IN RESPECT OF UB PLAZA SOFTWARE TECHNOLOGY PARK UNIT AND TITAN IUM UNIT IS IGNORED IN VIEW OF TWO TRIBUNAL ORDERS IN ASSESSEES OWN CASE FOR A SSESSMENT YEARS 2007-08 AND 2008-09 THEN INSTEAD OF DEMAND FOR ASSESSMENT Y EAR 2010-11, THERE WILL BE REFUND OF RS. 26.15 CRORES FOR ASSESSMENT YEAR 2 010-11. IN OUR CONSIDERED OPINION, SUCH DISALLOWANCE OF ASSESSEES CLAIM FOR DEDUCTION U/S. 10A HAS TO BE IGNORED FOR THE PURPOSE OF DECIDING THE ASSESSEES REQUEST FOR GRANTING STAY ALTHOUGH WHETHER SUCH DEDUCTION IS ALLOWABLE OR NOT IN ASSESSMENT YEAR 2010- 11, THE ISSUE IS REQUIRED TO BE DECIDED WHILE DECID ING THE APPEAL OF THE ASSESSEE FOR THAT ASSESSMENT YEAR AND THEREFORE, TH IS OBSERVATION IN THE THIS ORDER IN STAY PETITION OF THE ASSESSEE SHOULD NOT INFLUENCE THE DECISION ON THAT ISSUE IN THE APPEAL OF THE ASSESSEE BUT FOR THE PUR POSE OF GRANTING STAY TO THE S.P. NOS. 111 & 112/BANG/2018 (IN IT(TP)A NO. 266/BANG/2014 & IT(TP)A NO. 542/BANG/2015) PAGE 3 OF 3 ASSESSEE, WE FEEL IT PROPER TO CONSIDER THAT SUCH D EMAND SHOULD NOT BE ENFORCED AND HENCE FOR THE PURPOSE OF GRANTING STAY , WE CONSIDER THE DEMAND FOR ASSESSMENT YEAR 2010-11 AFTER EXCLUDING THE DIS ALLOWANCE MADE BY THE AO IN RESPECT OF THE ASSESSEES CLAIM U/S. 10A. WHEN THIS IS DONE, IT RESULTED INTO A REFUND OF RS. 26.15 CRORES IN THAT YEAR AND HENCE , CONSIDERING ALL THESE FACTS WE FEEL IT PROPER TO GRANT STAY TO THE ASSESSEE IN BOTH YEARS OF THE PRESENT CASE FOR A PERIOD OF SIX MONTHS FROM THE DATE OF THIS OR DER OR TILL THE DISPOSAL OF THESE APPEALS WHICHEVER IS EARLIER AND FIX THE HEARING OF THESE TWO APPEALS ON 07.05.2018. WE WANT TO MAKE IT CLEAR THAT IN COURS E OF HEARING OF THESE APPEALS, THE ASSESSEE SHOULD NOT SEEK ANY ADJOURNME NT WITHOUT ANY JUSTIFIABLE REASONS AND IF THE ASSESSEE DOES SO, THE STAY GRANT ED BY THIS ORDER WILL STAND VACATED AUTOMATICALLY. 4. IN THE RESULT, BOTH THE STAY PETITIONS FILED BY THE ASSESSEE ARE ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENT IONED ON THE CAPTION PAGE. SD/- SD/- (N.V. VASUDEVAN) (ARUN KUMAR GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER BANGALORE, DATED, THE 6 TH APRIL, 2018. /MS/ COPY TO: 1. APP ELLANT 2. RESPONDENT 3. CIT 4. CIT(A) 5. DR, ITAT, BANGALORE. 6. GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, INCOME TAX APPELLATE TRIBUNAL, BANGALORE.